Almost ten years ago, a historical moment in rail transport occurred when on October 6, 2008 a train arrived in Hamburg, Germany, 17 days after departing from Xiangtan in China’s Hunan province. While the service was at the time considered as too inconsistent and too slow to gain any real market appeal, China persisted with various train routes across Eurasia with regular service established in 2012. According to China Rail Corporation, 3,673 trains transited Eurasia in 2017, linking 35 Chinese cities with 34 European cities in 12 countries, a number set to rise to 4,000 in 2018. This commitment to free trade stands in rising contrast to the recent protectionist policies adopted by the U.S. Trump administration, divergences which seem likely to grow in the near future.

One of the most significant factors impacting Central Asia is its landlocked geography. This situation affects almost every sphere of life—foreign policy, national security and economy. However, China’s BRI project may alter the impact of China on the region. China’s BRI can transform Central Asia from its landlocked state to a transit region between Asia and Europe. Essentially, China is unlocking landlocked Central Asia. Recently, there have been two significant developments: the increase in volume of freight passing through the “dry port” of Khorgos, (in Kazakhstan), and the acceleration of the implementation of the China-Pakistan corridor leading to the Indian Ocean. Each of these developments plays a part in the Chinese initiative and in its impact on Central Asia. The BRI is, thus, the trigger for the geopolitical earthquake in the region.

Following high-profile visits by Premier Li Keqiang in 2015 and Xi Jinping in 2016, China’s is domestically devolving its trade and industrial relationship with Uzbekistan to provincial and prefectural levels of government. However, financing for China’s investment in Uzbekistan remains either directly invested or indirectly coordinated by one of China’s three central policy banks, Export-Import Bank of China, China Development Bank, and the Agricultural Development Bank of China. Since 2014, the Exim Bank has committed to fund Belt and Road projects worth around US$ 120 billion, which corresponds to nearly a full year’s GDP for Uzbekistan. These quasi-sovereign wealth funds certainly pose a systemic debt risk, but are not necessarily a debt-trap.

During January and February, several reports surfaced of a new Chinese military base in Afghanistan’s Wakhan corridor. According to Afghan officials, China and Kabul discuss building a base in Badakhshan and China will send an expert delegation to Kabul to determine the exact site, and will fund the base and all of its material and technical expenses, including weapons and equipment. China has denied these reports as they contradict its long-standing position that it is not seeking foreign bases or intends to intervene militarily in Central Asia. However, witnesses have reported seeing Chinese and Afghan troops on joint patrols. Moreover, there is a long record of signs of a growing Chinese military interest in Central Asia.

The Free Trade Agreement between China and Georgia, signed in 2017, came into force on January 1. This will allow Georgian products free access to one of the world’s largest consumer markets, and will free approximately 94 percent of Georgian products from customs taxes. The growth of China’s economic interests has increased Georgia’s hope of playing a role in in Beijing’s Belt and Road Initiative (BRI). By extension, China’s increasing presence in the South Caucasus raises questions regarding the compatibility of Beijing’s interests with those of the region’s traditional hegemon, Russia.

In December 2017 during a meeting in Beijing between Chinese Defense Minister Chang Wanquan and Afghan Defense Minister Tariq Shah Bahrami, China’s Central Military Commission vice chairman Xu Qiliang stated that China would build a military facility in Afghanistan’s northeastern Badakhshan province to “strengthen pragmatic cooperation in areas of military exchange and anti-terrorism and safeguard the security of the two countries and the region, making contributions to the development of China-Afghanistan strategic partnership of cooperation.” China’s main motive is to interdict the flow of Uyghur militants to and from Xinjiang, yet the initiative potentially has wider implications for Afghanistan and the region.

At first glance, Turkmenistan’s decision in January 2017 to stop selling gas to Iran was a minor episode in the context of an otherwise friendly relationship between Tehran and Ashgabat, as indicated by several meetings of high Iranian and Turkmen officials following the clash over gas deliveries. However, the tension with Iran could imply serious problems for Turkmenistan and lead to increasing dependence on Beijing, regardless of all Ashgabat’s maneuvering. Turkmenistan’s fallout with Iran also limits the ability of both the West and the South to access Central Asian gas and facilitates an increasing Chinese influence in this part of Eurasia, providing additional opportunities for China’s resurrection of the Silk Road.

International Capacity Cooperation is China’s policy answer to comparative advantage, a vast state-planning exercise to coordinate China’s trade and investment strategy in external geographies. It is the practical industrial policy matrix allowing industries, local governments, and policy banking to intersect with partner economies as part of the wider geoeconomic Belt and Road strategy. For China’s aluminum sector, which is already heavily state subsidized and widely considered to be dumping on international markets, it represents an opportunity to extend the lifespan of the industrial policy and policy bank model. The formation of an aluminum capacity cooperation enterprise alliance should be a warning signal to the non-ferrous metals industries of China’s trading partners in Central Asia.

The recent Indo-Chinese crisis over the Doklam area has been peacefully resolved for now, yet its repercussions risk spilling over to both South and Central Asia and beyond. The Doklam clash has demonstrated to China that it can no longer push India around, and India immediately registered that lesson in self-confidence by stating that it will play a larger role in Southeast Asia, another area where they both jostle for influence. Similarly, we can expect an expanded rivalry in Central Asia, not least within the framework of the Shanghai Cooperation Organization (SCO) now that India and Pakistan are both members.

On August 22, after nearly 16 years of war in Afghanistan, U.S. President Donald Trump announced his intention to increase the U.S. military presence there, extending the longest war in U.S. history and adding billions more dollars to its cost, now estimated to over US$ 1 trillion since 2001. In searching for revenue streams to support this outlay an idea that has been around for more than a decade is being revived: exploiting Afghanistan’s rich, underused mineral wealth. Despite the extent of the country’s mineral deposits being well known, many impediments remain to their development despite international interest.